With increased population in the metropolitan cities in India, the traffic condition has also worsen. To avoid the traffic during peak hours, people generally prefer a two wheeler for their commute. It is not only economical compared to travel by a car, but it also gives the individual flexibility and ease to commute than being dependent on the time or any other means of transport. Thus, it will not be incorrect to state that two wheelers i.e. motorcycles, scooters are greatly preferred in the country for daily travel. Even in smaller towns, where the public transport system is less developed and less frequent, a two wheeler is the preferred vehicle in every household. With the extended usage of the vehicle, comes higher cost of maintenance. Plus, if the vehicle is not adequately insured, the cost goes much higher.
Similar to a car insurance policy, two wheeler insurance is a plan which covers the two wheelers like bikes and scooters, financially in case of damage due to accident, third party liability or theft of the vehicle. Indian Motor Vehicles Act, 1988 Section 146 makes it mandatory for the owners of two wheelers to have a compulsory insurance for their vehicle. In India, every two wheeler is legally bound to be insured with a third party insurance cover. There are specifically two types of two wheeler insurance plans available in the market; one, a comprehensive insurance cover, and two, a third party insurance cover. Since, having a two wheeler insurance plan is mandated by law; riding without a valid insurance can invite serious legal procedures.
Comprehensive Two-Wheeler Insurance Cover: A comprehensive two wheeler insurance plan provides coverage to the vehicle in case of theft, loss or any damage due to an accident. This also provides the owner of the two-wheeler with a personal accidental cover in an event of accident. It is also inclusive of a third party cover which provides financial coverage to the owner or the rider in case of any third party liability arising from an accident. In a nutshell, a comprehensive two-wheeler insurance cover provides complete coverage to the two-wheeler and its owner from any damage or theft of the vehicle and also any third party liability.
Third-Party Two-Wheeler Insurance Cover: A third party two wheeler insurance cover is mandated by the Indian Motor Vehicles Act, 1988 and covers any damage or loss made to the third party vehicle and property in case of an accident. This type of insurance policy does not cover any damages or losses on your own vehicle. Unlike a comprehensive two wheeler insurance plan, a third party insurance plan does not provide any cover to the owner’s vehicle. Most of the insurance that is bought while buying a two wheeler in India, and as guided by the showroom agent, are third party insurance covers. Thus the individual buying a two wheeler still remains uninsured unless a comprehensive insurance cover is purchased.
Since the comprehensive two wheeler insurance cover provides all round protection to the vehicle, its owner and any third party involved, the premium charges are higher for a comprehensive insurance cover as compared to a third party insurance cover. Also, it comes with several exclusions where the claim cannot be made. Few of them are:
- Any wear or tear in the vehicle due to aging.
- Losses incurred due to depreciation of the two-wheeler.
- Losses incurred due to the policy holder riding without a valid license or under the influence of any intoxicants.
- Damages on the tubes and tyres of the vehicle.
- Any sort of mechanical or electrical breakdowns in the vehicle.
Though the law makes it compulsory for the two wheeler owners to buy an insurance cover at the time of purchase and subsequent renewals, it is imperative for the buyer of the two-wheeler to be well aware of the various two wheeler insurance policies available and makes a choice that best suits their needs.